'he Economic Solution 

of the 

European Crisis 



By 

HENRI LAMBERT 

Industriel k Charleroi (Belgique) 
Membre Titulaire de la Soci6t6 d'Economie Politique de Paris 



Translated from the French for the Papers 
for War Time (Oxford University Press) 



NEW YORK 
1916 



The Economic Solution 

of the 

European Crisis 



By 
HENRI LAMBERT 

Industriel a Charleroi (Belgique) 
Membre Titulaire de la Soci6te d'Economie Politique de Paris 



Translated from the French for the Papers 
for War Time (Oxford University Press) 



NEW YORK 
1916 






The White Houaa. 



The Economic Solution of the 
European Crisis 

"The making of peace is to he desired and to he regarded 
as a blessing, when it can insure us against the suspicious- 
designs of our neighbours, when it creates no new danger 
and brings the promise of future tranquillity. But if the 
making of peace is to produce the very opposite of all this, 
then, for all its deceptive title, it is no better than the con- 
tinuation of a ruinous war." — Guicciakdini. 

"No Treaty of Peace is worthy of its name, if contained 
therein are the hidden germs of a future war." — Kant,, 
Essay on Perpetual Peace. 

I 

In the present circumstances it is very difficult to pre- 
serve that international attitude of mind which alone can 
enable us to regard the questions at issue from the point 
of view of the general interests of Europe and of the 
world, without allowing ourselves to be influenced by the 
passions and prejudices that are inseparable from the par- 
ticular interests of nationalities. And yet such a frame of 
mind is indispensable for any one who wishes to have 
any prospect of finding in a just and permanent form that 
solution of the European problem that he is concerned to 
seek. I*Tor is it any the less necessary, if we restrict our 
aim to the search for a specific adjustment that can invite 
the careful consideration and the goodwill of all the parties, 
interested. 

The international situation of to-day is due to a series- 
of special circumstances affecting the interests of nation- 
alities. National psychology is a factor which has played 
in it a part the importance of which neither is nor can 
be contested. But the real "causes," the original and" 
deep-seated causes, were of a far more general character,, 
connected with the very nature and necessity of things. 

3 



The Economic Solutiox of the European Problem 

Any ''pacifist'' conception that can hope to offer, side 
by side with the theoretic principles of a complete and 
final Imman agreement, a practical means of putting an 
end to the work of niin and extermination that threatens 
^European civilization, must be inspired by a consideration 
•of these ultimate causes : it must stand entirely aloof from 
.all pre-occupation with particular national interests; it 
must consequently belong rather to the sphere of philos- 
ophy than to that of politics. 

The war will of necessity be followed by a peace, but 
the universal and permanent peace that each of the bellig- 
erents declares to be the supreme result to be attained 
by this war will not be the achievement of superiority of 
arms, nor of skilful strategy, nor, alas ! of the bravery of 
soldiers: these forces will only be capable of imposing a 
temporary peace, consisting in the subjection and oppres- 
sion of the conquered. A peace worthy of the name and 
worthy of true civilization will be the achievement of the 
thought of those who shall succeed in furnishing a con- 
ception of the mutual rights of nations, in accordance Avith 
true justice. Universal and permanent peace will be es- 
tablished upon the basis of justice — or never at all. 

II 

True justice in international relations is before all and 
fundamentally a policy that favours the economic develop- 
ment of all nations, without excluding any. Xo doubt 
the production of wealth is not the supreme aim and object 
assigned to humanity, and economic prosperity can never 
provide the consummation of the edifice of human prog- 
ress ; but it does provide its foundation and also its mate- 
rial structure, and the right of every nation incessantly 
to consolidate and build up this edifice is inalienable. 
And since the growth of the material prosperity of 
nations is the necessary condition of their intellectual 
and moral advance — for we cannot conceive of true 
civilization as a product of poverty — their right to 
the fullest economic development compatible with the 
wealth of their soil and their own capacity for useful 

4 



The Economic Solution of the European Problem 

effort is a right that is natural and indefeasible — a divine 
right, jSTow the economic development of a nation is in- 
separable from the constantly extending operations of its 
exchanges with other nations. Exchange is thus seen to 
be the main fact and the essential right in international 
relations. Every political hindrance to exchange is a 
blow dealt to international rights. Freedom of exchange 
will be the tangible manifestation and the infallible 
test of a condition of true justice in the relations between 
different peoples. And in default of this, international 
right — and peace, which stands or falls with it — will con- 
tinue to lack a real and solid foundation. 

Peace will be assured by law w^ien nations realize and 
put into practice their true international rights, that are 
characterized by freedom of trade and are susceptible 
of recognition by all because they respect the primary in- 
terests of all.^ 

Until international law and international justice are 
thus one and inseparable, humanity will continue to ex- 
perience only periods of more or less precarious peace^ 
necessarily dependent upon the will and the interests of 
those nations that have the greatest force at their disposal. 

We must not lose sight of the fact that, under modern 
conditions of war, only those nations that can command 
great economic resources can be very powerful in arms. 
Now it is certain that these nations will finally come to 
insist upon freedom of trade. Progress cannot be coerced ;; 
failing of its normal fulfilment through the agency of 
ideas, it would attain its realization by force. 

Moreover, it is only freedom of international trade that 
can give to a nation's industries that stability and secur- 
ity of imports and exports that is indispensable to them; 
whilst in the absence of such security powerful nations 
that are careful of their future neither can, nor should, 
consent to abandon the conception of economic prosperity 
guaranteed or protected by military power. Whatever ob- 

1 As we shall indicate later, freedom of trade will gradually sim- 
plify and facilitate, to the extent of making them at last perfectly 
natural, the solutions of the difficult, and probably otherwise insolu- 
ble, problems that arise from the affinities of nations in race, char- 
acter, and language. 



The Ecoxomic Solutiox of the Europeax Problem 

jections may be urged to this conception, there is no doubt 
that the great nations and their governments will never 
consent to abandon it until international economic liberty 
^nd security are finally established. Tariff restrictions 
are the worst obstacles to the advent of that true civiliza- 
;tion which will be marked by peace with disarmament. 
Such a civilizatidn and such a peace will only be possible 
imder the conditions of economic justice and security that 
will result from free trade. 

Cobden said: "Free trade is the best peacemaker.' We 
may confidently affirm : "Free trade is the peacemaker." 

Ill 

The pacifists have not sufficiently insisted upon this 
truth, of primary impoj'tance^ that economic interests are, 
to an ever-increasing extent, the cause and the aim of 
international politics, and that protection separates these 
interests and brings them into mutual opposition, whereas 
free trade would tend to unite and consolidate them. 

For the vast majority of individuals, harmony of sen- 
timent can only arise from harmony or solidarity of inter- 
ests, and whatever unanimity may exist between them, 
harmony of sentiment will not withstand for long the 
shock of antagonistic interests. Is it not inevitably the 
same with national sentiment ? 

"Immediately after the War of Independence, the thir- 
teen United States of America indulged themselves in the 
•costly luxury of an internecine tariff war . . . and, at 
one time, war between Vermont, New Hampshire, and 
IN'ew York seemed all but inevitable."^ When the Swedes 
•established restrictive tariffs against the products of ISTor- 
way, the dissolution of the union of the two countries was 
predicted by Norwegians of high scientific and political 
standing; ten years later this prediction was confirmed 
by the event. Did not we see, some years ago, the vine- 
growers of the Aube determined to declare civil war upon 
those of the Marne because an attempt had been made to 

1 Mr. Oliver, quoted by Lord Cromer in a report to the Interna- 
tional Free Trade Congress, of Antwerp (August, 1910). 



The Economic Solution of the European Peoblem 

establish economic and protective frontiers between these 
two districts? Is it conceivable that, in the present in- 
dustrial epoch, peace should continue, even for so long as 
half a century, between the English and the Scotch, be- 
tween the Italians of the north and those of the south, 
between the Prussians and the southern Germans, between 
the Austrians and the Hungarians, between the French of 
the north and the French of the south, between the States 
of the American Union, if tariff frontiers were re-estab- 
lished between these groups ? 

It is the adoption of free trade within a nation's own 
borders that, by consolidating and unifying her economic 
interests, furnishes the real support and solid foundation 
of national unity ; it will be the adoption of free trade 
between nations that will have to accomplish the same work 
in the wider international sphere. We must, then, con- 
sider as a fatal error and one too widely spread, the idea 
that free trade can only be the ultimate result of a good 
understanding between the nations : the truth is that free 
trade is the indispensable preliminary condition of any 
good understanding that is to be permanent. 

Yet, the predominant importance of protection or free 
trade in international relations lie rather in moral consid- 
erations than in material interests. It is due particularly 
to the fact that whilst protection is a manifestation of in- 
ternational injustice, free trade is the very embodiment of 
international justice. And such justice and injustice are 
fundamental, since they apply to the fundamental relations 
between nations, bearing upon their material, vital, funda- 
mental necessities. And further, the material interests of 
nations, in other words they physical interests, form the 
concrete substratum, indispensable and natural, for their 
intellectual and moral interests. 

In order that international politics should be controlled 
advantageously, no longer by the material interests of 
men, but by their- intellectual and moral aspirations, it 
would first of all be requisite that international methods 
of dealing with material interests should be at least tol- 
erable. If men are incapable of dealing successfully with 

7 



The Economic SoLrxiox of the Europea^t Problem 

their international material interests, how can they be com- 
petent to deal successfully with their international intel- 
lectual and moral interests, which are so far more complex ! 
The pacifists have far too much neglected these realities 
of the ideal with which they are inspired, and it is this 
that explains, to a great extent, the ineffectiveness of their 
noble efforts. They have preached the spirit of concilia- 
tion in the policy of States toward one another, interna- 
tional arbitration, disarmament ; but in so doing they have 
not been attacking the cause of all the evil. Militarism, 
international quarrels, armaments and even "race hatred" 
are in our day, and particularly amongst the great Euro- 
pean nations, merely effects, of w-hich the cause is to be 
sought in antagonism of economic interests, due in the 
great majority of cases to protection. 



IV 

It will not, however, be necessary, in order to bring about 
the beginnings of an era of universal and permanent peace, 
that every nation should embrace the policy of ideal eco- 
nomic justice that would be realized in complete free 
trade: it will be enough that three, or perhaps two only, 
of the most advanced and most powerful nations — Eng- 
land, Germany, France or the United States — realizing at 
length their true general interests, economic, social, and 
political, and drawing their inspiration from the prin- 
ciples of free trade — should adopt "tendencies" definitely 
directed towards commercial liberty and should impress 
similar tendencies upon the policy of secondary nations, 
by example, by influence and, if need be, by legitimate 
pressure. 

Hitherto, and especially during the last thirty years or 
so, the policy of the great nations, with the exception of 
England, has followed a course diametrically opposed to 
this. Taking as their guiding principles ill-will, jealousy, 
and self-interest — a self-interest, be it noted, grotesquely 
misunderstood — revealing an inconceivable misconceptioii 
of economic truth and a no less incredible folly, the great 

8 



The Economic Solution of the European Problem 

nations have not ceased to increase their efforts to secure 
isolation, mutual exclusiveness and mutual constraint by 
means of protective tariffs. The economic foreign policy 
of each nation consisted above all else in the attempt to 
apply to other nations a treatment, in the matter of tariffs, 
against which she would hasten to protest energetically and 
even, if need- be, by force of arms, when there was any 
suggestion of its application to herself. Such a policy, as 
logically inconsistent as it was unjust, was bound sooner 
or later — especially as it was applied in an epoch marked 
by an immense development of industries — to lead to a 
catastrophe. Could the continuation of such a policy 
leave room for any hope of the advent of that reign of 
peace and goodwill among nations to which humanity as- 
pires ? It is at once logical and obvious that mankind 
can never hope for such a reign of peace until some at. 
any rate among the nations resolve, in their economic rela- 
tions with other States, to conform to the maxim^ which 
sums up all rules of conduct : do not do to others what you 
would not that they should do unto you. 

Moreover, it must not be forgotten that in the sphere 
of domestic policy, protection is a system of robbery and 
impoverishment of the masses of consumers for the benefit 
of privileged minorities of producers ; that it is thus based 
upon the spirit of injustice within the State, as well as 
toward other States ; and that it would be contrary to 
the sound nature and sacred logic of facts, and almost 
blasphemous, to expect from such a political system that 
it should produce anything else but evil and disorder 
wherever it is put into practice. 

Because she has failed, or perhaps because she has not 
sufficiently sought, to induce other nations to adopt the pol- 
icy of liberty and justice, to which she has herself success- 
fully adhered. Great Britain suffers with them the con- 
sequences of their errors; for, as has long ago been testi- 
fied, the rain falls upon the just as well as upon the unjust. 

But the storm is one that never should have burst: it 
could have been, and ought to have been, prevented. 

9 



The Economic Solutiox of the European Problem 



The United Kingdom comprises 45,000,000 inhabitants, 
and their industries and their trade have at their disposal 
the markets of colonies that extend over a fourth of the 
surface of the globe, that are capable of supporting sev- 
eral thousand million inhabitants and are now occu- 
pied bj about 400 millions. The British nation sends 
out her sons and exports her products, in complete secur- 
ity and stability, into these possessions, of which some, 
and those not the least important, give a privileged posi- 
tion to British products by means of differential tariffs. 

France is in an analogous position from the point of 
view of her colonies, especially if due allowance is made 
for her needs, her desires, and her limited capacity for 
outward expansion. Moreover, she introduces, for the ben- 
efit of her producers, a highly privileged system of tariffs, 
wherever she establishes her rule. 

Kussia and the United States have vast territories with 
gi'eat natural resources, far exceeding the needs of their 
jDopulations. 

The Empire of Germany has a population of approxi- 
mately 70,000,000, constantly growing at the rate of 
nearly a million a year. Their industries and their trade 
are only assured of their home markets and of certain 
colonial markets of relative insig-nificance. The territory 
of the German Empire is exactly one-tenth of that of 
the British Empire, and will only be capable of occupa- 
tion in the future by a very limited number of additional 
inhabitants and additional consumers of German products. 

As far as her outlets of population and her markets are 
concerned, the German nation^ with her very considerable 
— an entirely legitimate — needs, desires, and capacity for 
outward expansion, is placed, it must be admitted, in a 
position which is not only inferior, but also precarious. 
For, the idea of protection places all intercourse between 
nations upon a footing of mere tolerance, which may at 
any time be transformed into complete intolerance, an 
intolerance then possibly extending as well to human beings 
as to merchandise. 

10 



The Economic Solution of the European Pkoblem 

Assuredly it is not one of the least disadvantages of 
protection, that it involves a general instability and inse- 
curity, both for those who adopt it and for those against 
whom it is directed. Germany^ by her adherence to pro- 
tection, both caused to others and suffered herself these 
disadvantages. Did not Russia announce^ in July 1914^ 
that she was contemplating radical alterations in the 
Kusso-German commercial treaty expiring in 1916 ? Was 
not France preparing to secure, by means of fresh addi- 
tions to her tariffs, the resources required for the applica- 
tion of the three-year service law ? Is there an assured 
majority of citizens in the United States converted to the 
policy of freer imports ? And can we exclude the possibil- 
ity that in a few years' time England may have a majority 
of electors favouring proposals of tariff" reform and the 
formation of a vast economic empire of closed markets ? 

It cannot then be contested that, as far as her outlets 
and foreign markets were concerned, Germany's economic 
position was unstable, uncertain. 

It is true that an elementary understanding of her true- 
interests, both economic and political, ought long ago to 
have induced her rulers to adopt a free trade policy, by 
gradually reducing the barriers of her Zollverein, and 
inviting other countries to extend to her a similar treat- 
ment. Had they done this, how easy it would have been 
for them and how advantageous, in answer to the proposals 
for disarmament made to them from time to time, to insist 
that a great industrial nation cannot rest satisfied with 
precarious markets, and that there can be for her no dis- 
armament failing economic security, the primary element 
of national security. Germany would thus have won the 
sympathy, the support and the eager co-operation of free 
trade England, as well as of Holland, Belgium, Denmark, 
and the majority of enlightened public opinion in all the 
nations of the world. 

But Germany and her rulers have not chosen such a- 
policy of truth, progress, justice, and peace. They have; 
been subservient to the particular interests of narrow or 

11 



The Economic Solution of the Eukopean Problem 

unscrupulous agrarians and manufacturers ; tlicy have ac- 
cepted the disinterested but false theories of their profes- 
sors of "Rationale Wirtschaft"^ ; they have been fasci- 
nated too by the idea of an economic and military im- 
perialism of the German race, and they have preferred 
the attitude of conquerors, who fail to understand and 
refuse to recognize any other advantages than those that 
may be secured ^by force. 

But did this attitude of Germany, clumsy and pitiful 
as it may have been, make it any the less foolish and 
impolitic of other nations to expect her to accept as final 
the inadequate and precarious position created for her by 
her past history, as well as by her own political mistakes 
in the present day? Should not a true political wisdom, 
revealed in foresight and justice, have prescribed one of 
two courses : either that the other nations should agree to 
facilitate the formation by Germany of colonial dominions 
-of her own, which a very intelligible pride and economic 
necessity alike prompted her so eagerly to desire, or that 
they should offer her stable assurances and compensations, 
capable of satisfying both her pride and her interests, by 
undertaking to throw open to her, if not their home mar- 
kets, at any rate those of their colonies ? It would, of 
•course, be understood that the German colonies should 
;also be thrown open to free international intercourse. 

I^othing was done in this direction, indeed quite the 
contrary. The plutocrats, the militarists, and the war 
party in Germany were left in possession of an almost 
imperative argument in their favour, and thus the other 
nations helped to maintain and embitter the spirit of con- 
quest in the German people. 

Economic mistakes, political blindness and rashness, an 
inadequate conception of international justice on the part 

1 How can it be explained that the German savants and leaders 
have not realized that Germany owes her powerful economic develop- 
ment not to the system of protection, but in great part to the system 
<of free trade established between twenty-nine States formerly sep- 
•arated by customs frontiers, numbering half a century ago less than 
40,000,000 inhabitants, and to-day nearly 70,000,000 free trade pro- 
ducers and consumers? 

12 



The Economic Solution of the European Problem 

of all the nations and their governments, sncli were the 
real causes of the cataclysm that is now overwhelming 
Europe and all mankind. 

VI 

Is it too late, or can it be too soon, for a general admis- 
sion of guilt ? Errare humanum, perseverare diabolicum. 
Instead of allowing the abominable and wicked work of 
ruin and extermination to continue, is it not the duty of 
the rulers of all nations, towards God and mankind alike^ 
to use their best efforts for a reconciliation based upon 
truth and justice ? 

Their duty towards God^ for the Providential design for 
the perfecting of human progress obviously involves the 
association and co-operation of peoples as well as of the 
individuals by means of exchange of services, and not their 
isolation, mutual exclusion, their suppression or subjec- 
tion. Is not the interchange of the products of labour the 
natural primary fact from which all progress, all civiliza- 
tion directly or indirectly originate ? Their duty towards 
mankind, because men will become worthy to enjoy the 
peace of nations to which they aspire, when, under the 
guidance of enlightened and conscientious leaders, they 
have been permitted to grasp the idea of human solidarity^ 
by the primary means of exchange, from which will spring 
the infinite ramifications of mutual service. Their duty 
towards mankind again, because it is in all that is noblest^ 
strongest and best in men^ and all that is most valuable 
and most useful in things, that is to say in the objects of 
its legitimate pride, its affections, and its hopes, that man- 
kind is threatened. 

And besides, why continue the sacrifice of countless 
victims and the adding of ruin to ruin ? It is exceed- 
ingly probable that, in spite of incalculable sacrifices of 
men and wealth on both sides, there will be in this war 
neither conquerors nor conquered : Germany will be re- 
strained, she will not be crushed. There will have to be- 
"an adjustment." 

13 



The Ecoxomic Solutiox of the European Problem 

And it is better that it should be so, for war can no 
more be definitely conquered by war than oppression by 
oppression, injustice by injustice, evil by evil. 

There will have to be an adjustment: it will be nec- 
essary to agree to mutual concessions in satisfaction of the 
main legitimate demands. And there will have to be an 
effort to make this adjustment final, with a view to a 
universal and lasting peace. 

The writer of these lines believes that he has shown that 
it would be advantageous and j)olitie to assure to Germany 
.a more stable economic position. He believes, also, that 
he has proved that there can be no permanent peace fail- 
ing the adoption of a policy inspired by justice in inter- 
national economics, and thus "tending" towards freedom of 
commerce, to find its consummation in universal free trade. 

A final adjustment that will make for permanent peace 
involves, then, in the first place, agreements sanctioning 
the removal of tariff restrictions between the belligerent 
countries — or at any rate the gradual lowering of tariffs 
with a guarantee to all of equal and reciprocal treatment. 
All other reforms that are the objects of legitimate na- 
tional hopes or intents must, in order to be profitable, be 
the consequences or corolkries of an equitable economic 
adjustment. 

Such an adjustment of tariff's would also be imperative 
if, contrary to all probability, this war should end in 
crushing defeat for one or other of the adversaries — a sup- 
l^osition necessarily involving the sacrifice of twenty, 
thirty, fifty millions of human lives^ on the field of battle, 
in towns and country districts, by wounds, by sickness, and 
iDy privation — involving too the destruction of incalculable 
artistic and economic wealth, and probably, alas! the an- 
nihilation of innocent Belgium, which will not be the least 
of Euroj)ean crimes. 

Let us suppose, indeed, that the victors impose upon the 
Tanquished an inequality of tariffs that places them in a 
position of economic inferiority, and that mankind thus 
reverts to the system of national servitude in a modern 
guise. Is there any man of foresight or indeed of simple 

14 



The- Economic Solutiox of the European Problem 

common sense who thinks that it is possible to reduce to 
servitude and keep in that condition, under whatever form 
or bj whatever means, nations of which some comprise 
even now and the others will comprise Avithin a century 
hundreds of millions of individuals ? Certainly not half a 
century would elaj^se before, the wdiirligig of time bring- 
ing its revenges, the oppressed would take advantage of 
fatal dissensions among their oppressors — for how many 
alliances last half a century? — and reverse the positions 
with the acclamation of all the peoples that have remained 
outside the present conflict and its results. 

Looking at the matter exclusively from the point of 
view of the victors, whoever they may be, .the only wise 
and far-sighted policy will be that which has ever been 
the best : to be just, to live and let live. Apart from the 
imposition of just war indemnities, nothing durable 
and advantageous and compatible with subsequent peace 
could be done beyond imposing upon the vanquished the 
obligation to abolish or reduce considerably their customs 
duties, whilst granting them fair reciprocal treatment.'^ 

If we have proved that the original cause of the present 
war was economic, that it can be ended satisfactorily only 
by an economic adjustment, and that such an adjustment 
could be introduced at once, have we not also proved that 
it w^ould be criminal to continue the work of ruin and 
massacre ? Is it conceivable that for the sake of securing 
a war indemnity the English, Germans, and French should 
demand the sacrifice of countless more lives of their sons 
and their brothers ?" 

1 It is worth while to emphasize the fact, too much overlooked by 
manufacturers and merchants, that the abolition of import duties 
would be the only reasonal)le and effective method of suppressing that 
act of war applied to industrial competition, known as '"dumping," 
for which German industries have been justly blamed. 

2 It is not unreasonable to suppose that if the war were to end by 
the crushing of one or other of the. two sides, it would last for at 
least three more years; it would absorb almost all the available 
capital of Europe; and from it would result unutterable suffering 
and destitution. No doubt it would be an insult to the intelligence 
of our statesmen to suppose that they do not understand that the 
result would be, at no distant date, the social revolution of Europe — 
unless, indeed, not enough men were left to carry it out. But there 
would always be electors enough left to deprive of power the incom- 
petent representatives of imbecile ruling classes. 

15 



The Economic Solution of the European Problem 

VII 

The system, no less absurd and inconsistent than nnjust, 
of mutual economic isolation and exclusion between na- 
tions, vigorously and widely adopted in the last thirty 
years or so amid the utmost development of industrialism, 
was the substantial, deep-rooted, and ever-present cause 
of European dissensions and of the terrible conflict of the 
present time. 

A really effective peace movement must undertake to 
remove this disturbing cause. 

But no doubt it would be a task impossible of realiza- 
tion, especially in the midst of the struggle, to rid Europe, 
at a blow, of the whole mass of obstacles, consisting of 
tariff laws, restrictions, and j)rohibitions, which make it 
impossible for her peoples to be united and consolidated 
(even in spite of themselves) by an indestructible net- 
work of economic interests. Besides, every undertaking 
must have a beginning. 

!N^ow despite appearances and superficial incidents, the 
question of colonial outlets — of 'a. place in the sun' — has 
hardly ever ceased to be the central factor in Germany's 
legitimate anxieties and the nodal point of all complica- 
tions that have arisen. 

It is then the colonial system that should be the first 
object of reform — not only because we should then be 
dealing with the real cause of the difficulty, but because 
it is precisely on the question of the reform of their colon- 
ial administration that the nations would soonest and most 
easily come to an understanding. 

Among the politicians of France, among the economists 
of that country, and also in industrial and commercial 
circles, the idea has grown up, under the stimulus of facts, 
that the French colonies are suffering from the narrow- 
ness of the economic system resulting from their "pro- 
tective" tariff. On several occasions this opinion found 
expression in the Chamber of Deputies, and a Premier was 
able to assert, without raising a protest or a denial, that 
the system of the "open door" ought to be applied to all the 
French colonies, because it is apparently the indispensable 

16 



The Economic Solution of the Eukopean Problem 

condition of their prosperity. What is true of the French 
colonies is true of all other "protected" colonies. 

A Conference, in which all the Nations of the 
World should be invited to participate^ should be 
summoned at once (in a neutral couptrj and under 
favour of an armistice which appears to be possible for 

such a purpose), ENTRUSTED WITH THE TASK OF MAKING 
AN AGREEMENT BETWEEN ALL COLONY-HOLDING NATIONS 
THROWING OPEN THE COLONIES OF ALL TO THE FREE TRADE 
OF ALL. 

This conference luoiild further set before itself the ob- 
ject of reaching a second agreement, by which as large a 
number of nations as possible ivould bind themselves to a 
gradual reduction in the tariffs of the mother countries. 

(This reduction might, for example, take place at the 
rate of 5 per cent, per annum, without, however, anv 
'obligatory' fall in import duties below 50 per cent, of 
what they are at present. Example and results would be 
responsible for the rest. We suggest here that no measure 
would be better calculated for creating international good- 
will and good faith, for arriving at an early and ensuring 
a durable peace, for giving a certain guarantee for the 
future welfare and progress of mankind, than would be 
an immediate reduction by Germany of 50 per cent, of 
her customs duties in agreement with Great Britain for 
the continuation of her Free Trade Policy. Is it too much 
to expect from the United States that they should in con- 
junction therewith adopt an international economic policy 
more worthy of a truly human and Christian civilization 
as well as of a young, vigorous and great nation endowed 
with the largest, richest and most generous territory of the 
world ?) 

Both agreements — that affecting the colonies and that 
affecting the mother countries — should be concluded for 
a period of at least fifty years.^ 

1 It is extremely irrational and dangerous and moreover contrary 
to sound law to conclude international agreements ad aeternum, that 
is to say, without any limit. Such agreements, like all contracts, 
should be made for a definite period and renewable. They will thus 
have a greater precision of meaning and will involve a more formal 
obligation. An international treaty without the stipulation of a 
period involves the mental reservation rebus sic stantibus. 

17 



The Ecoxo:mic Solution of the JEukopean Problem 

The colonial agreement would apply not only to present, 
but also to future colonies ; this would give it its full value 
and would remove a great danger of subsequent dissension. 

The throwing open of the colonies to international free- 
dom of trade would not necessarily mean the immediate 
abolition of all colonial tariffs, hut it ivould imply the im- 
mediate extension to the commerce of all nations of 
identical economic treatment in all colonial markets, that 
is to say, the suppression of exclusive and privileged 
'spheres of influence' and the adoption of equality of gen- 
eral ecojiomic opportunities or the system of the 'Open- 
Door.' England would thus have to surrender and refuse 
for the future the preference granted her in Australia, 
Canada, and South Africa: in doing this she would only 
be following the example of Holland, which has refused 
any preference in her colonies for her home products. On 
the other hand, France, Germany, and the other nations 
would throw open to British activities their colonial ter- 
ritories — and this applies to territories which are four 
times as large as Europe, and in which trade and industry 
are all the more capable of development, because, under 
the restrictions of privilege, they are at present relatively 
insignificant. 

The objection may be urged to the system of freedom of 
trade — and also to that of equality of treatment in the 
matter of tariffs and economic opportunities — that these 
systems might prove unfavourable to the interests of poor 
or less wealthy colonies, some of which necessitate con- 
stant sacrifices on the part of their mother countries : for 
if the latter no longer derived any direct advantages or 
compensations in return for their sacrifices, they might 
neglect such colonies. But it is easy to conceive some 
clause in the colonial agreement, stipulating that the whole 
or some part of the expenses of the mother country should 
be redistributed among the nations in proportion to the 
amount of their respective trade with the colony concerned. 
The natural result of this would be a system of co- 

1 The British autonomous colonies should necessarily participate 
in a conference and in any agreements as independent States. 

18 



The EcoisroMic Solution of the European Problem 

operation, with a control which would be the best gi.ar- 
antee for the coupled profitable employment of the money 
spent and for the good administration of the less pros- 
perous colonies. 

Such a system ivoidd in every respect he the equivalent 
of the internationalization of the colonies — ^^vithout its dis- 
advantages and its difficulties — and it may be proposed 
as a method of just and loyal association or co-operation 
of all nations in the universal work of colonization.^ 

Finally, these two agreements — affecting respectively 
the colonies and the mother countries — would be the de- 
cisive step in the direction of universal free trade and 
peaceful industrial civilization. 

Xeed it be pointed out that the great lesson in justice 
and civilization that would result from such an adjust- 
ment on pacifist lines, would be calculated to make a pro- 
found impression in Germany, where, after all, men with 
minds ca^^able of embracing anew ideas of liberty and 
justice remain in a vast majority ? And it would be cal- 

1 There is no longer any doubt that the annexation of the Congo 
was, from more than one point of view, a great mistake. It is a 
thankless task and far too heavy for Belgium. The adoption of the 
colonial regime which we have sketched would offer to the great 
nations the opportunity and the means of doing a great service to 
Belgium and at the same time to themselves. 

As early as 1908, on the occasion of the discussions on the an- 
nexation, the author had suggested the internationalization of the 
whole "Conventional Basin" of the Congo (comprising the Belgian, 
French, British, German and Portuguese Congo colonies), together 
with the application of the system of free trade (or of the ''Open 
Door") in all other colonies of the world as the only means of 
dispersing the heavy clouds that threatened Europe. He again 
proposed this solution of the European difficulties in 1910, in a 
study on ''La Belgique et la Libre Echange," in 1913 under the title 
"Pax Oeconomica," in a pamphlet published by the Ligne da Libre 
Echange of Paris, and in October, 1914, in an "open letter to Mr. W. 
Wilson, President of the United States," which appeared in the 
Nicume Rotterdamsche Courant. 

Contemporaneously ideas nearly identical (inspired as it seems 
by the Morocco incidents) were put forward by a prominent Amer- 
ican, Rear Admiral F. E. Chadwick, in several prophetic writings, 
of which we cite the following: "The Anglo-German Tension and a 
■Solution," 1912; "Tlie True Way to Peace," an address at the 20th 
Lake Mohawk Conference, 1914. 

Simultaneously also, in England, the idea of free trade in all 
colonies of the world as an essential condition of a complete and 
definitive solution of the European problem was propounded in a 
masterly way in several books by E. D. Morel, an authority in the 
questions of international colonial politics. 

19 



The Economic Solution of the European Problem 

ciliated to detach, in her foreign and domestic policy alike, 
the liberal and democratic parties, as well as the most 
clear-sighted of her mannfacturers and merchants, from 
the parties of plutocratic reaction and militant imperi- 
alis.m. 

We have said over and over again, but we do not hesi- 
tate to repeat once more, that it is not by force that the 
spirit of militarism and of conquest can finally be over- 
come : It can only be by the adoption of the principles of 
truth and justice in international politics. 

VIII 

The author of the present paper has had two objects in 
view: to provide a theoretic formula for universal and 
permanent peace — that is summed up in the term free 
trade — and also a practical formula, resulting from it, for 
the adjustment on pacifist lines that is desirable at the pre- 
sent time and that is capable of leading up to such a 
peace. 

But he cannot allow himself to be reproached with hav- 
ing apparently overlooked or neglected the question that 
has the most powerful, the most legitimate and the most 
sacred hold upon the hearts of his compatriots and their 
friends : the question of the fate of Belgium. 

We have said that an 'adjustment' is inevitable, that 
is to say, a many-sided agreement embracing equitable 
concessions on both sides. But no peace and no adjust- 
ment are possible, — nor desired, hy any Belgian, that do 
not involve the restoration of Belgian independence and 
the freedom of Belgian territory. 

Equtitable inoral compensations and material indem- 
nities will be due, moreover, to this nation, the victim and 
the martyr of the errors and- quarrels of her powerful 
neighbours. 

Let us suppose that Germany, recognizing her economic 
errors, the futility of her conception of human progress, 
and the defects of her international policy, should an- 
nounce her acceptance of the pacifist adjustment that we 
have proposed — and that we hereby submit to the States- 

20 



The Economic Solution of the Eueopean Pkoblem 

men; let us suppose that Germany, announcing her 
desire to resume her place in the ranks of civilized 
nations, should undertake to evacuate Belgium and to in- 
demnify her — with or without the concurrence of the other 
belligerents. It could only be France that could urge any 
objections. England obviously could only be too happy to 
see Germany enter upon the path of an economic policy 
on liberal lines and moreover in conformity with her own. 
Russia has no colonies (unless we regard Siberia as such), 
and it does not seem unlikely that she might be inclined 
to become a party to a possible agreement between the 
mother countries, tending towards greater freedom of 
trade in the future, Austria is in precisely the same 
position. 

But France is engulfed in the quicksands of Protection ; 
she has forgotten the period of commercial prosperity that 
she enjoyed under the commercial treaties of the second 
Empire, which from that point of view was more liberal 
than the third Republic; and in spite of the advice of 
her most enlightened politicians, of her best economists 
and of her most authoritative Chambers of Commerce, she 
might insist upon maintaining for her colonies the hateful 
economic system that she has imposed upon them: a sys- 
tem that has brought misfortune upon them, upon herself, 
and upon Europe. But I do not hesitate, as a Belgian, to 
assert that the government and rulers of France must 
refuse, eventually, to be guilty of such an act and of such 
an attitude, if there is one word of truth in the protesta- 
tions of eternal and boundless gratitude which have been 
expressed by France to Belgium in the last two years. I 
would add that these protestations were not in the least 
extravagant, for on two occasions — after Liege and after 
Louvain — Belgium sacrificed herself, without any mate- 
rial, moral, or international obligation so to do, and saved 
France, and then England, from the designs of the Ger- 
manic race. I would venture to remind France and Eng- 
land that they have a duty to fulfill: the duty of employ- 
ing every possible means of saving Belgium from the su- 
preme ordeal, provided these means do not prejudice the 
civilization of the future but rather tend to promote it. 

21 



The Economic Solution of the Eukopean Problem 

In the interests of future peace the question of Alsace- 
Lorraine must also receive a solution. But here we must 
not overlook the legitimate interests of the inhabitants 
of German origin, who form a very important part of the 
population of these districts. Xor must it be forgotten that 
many of the inhabitants of French origin had abandoned 
the idea of reunion with France on the condition of satis- 
factory and radical alterations in the Reichsland statute. 
Is it impossible to conceive in these provinces a govern- 
ment independent or autonomous satisfying every legiti- 
mate interest, aspiration and feeling, whether French or 
German ? 

The author asserts his belief and indeed his conviction 
that the two questions of Belgium and of Alsace-Lorraine 
can be easily solved by the economic agreement which he 
proposes, and which he considers calculated to satisfy the 
legitimate demands of Germany. 

It is appropriate to emphasize here the general truth 
that freedom of international commerce will greatly facili- 
tate and simplify the solution of the complex and delicate 
questions arising from racial affinities. What interest 
could nations have in organizing huge empires, embracing 
numerous peoples and vast territories^ if they were certain 
never to need to fight either amongst themselves or against 
other nations ? Would not this superior condition of in- 
dustrial civilization give them henceforward the assured 
and unrestricted means of exchanging their goods as well 
as of interchanging their ideas ? What grounds could 
they still have for refusing to loosen or abolish the ties of 
a dependent position that would have either remained or 
become distasteful ? With freedom of commerce, the na- 
tions would soon come to recognize that all the advantages 
that they hope to obtain through territorial expansion, 
through the conquest and subjection of other nations, are 
found, with no risks and no drawbacks, in the stabil- 
ity and security of international relations. Such a sys- 
tem alone admits of the permanent reconstruction of pre- 
servation of those 'natural nationalities,' whose aspirations 
are amongst the noblest and most legitimate of our era ; 

22 



The Economic Solutjo]?^ of the European Problem 

for the principle which they embody, as has been bril- 
liantly proved by Kovicow {La Question de V Alsace-Lor- 
raine), is the basis of the international as well as of the 
national and social order. 

IX 

A study of the European question cannot ignore the 
question of armaments, upon which it may certainly be 
noted that it is an extraordinary delusion, indeed an in- 
conceivable blunder, to suppose that by the suppression 
of armies war would be suppressed and that to assure 
peace a beginning must be made by suppressing armies 
and ''militarism." Is it not the simple common-sense 
truth that, in order to be able to suppress armies and mili- 
tarism, we must first of all suppress war — that is to say, 
we must create a position of international security ? 

Treated illogically, the question of disarmament, or of 
mere limitation of armaments, is inextricably complex 
and calculated to raise the most dangerous difficulties, 
not only between belligerents who would be in a fair way 
towards a pacifist adjustment of their differences, but also 
between belligerents and neutrals, and between nations in 
actual or prospective understanding with one another. But 
the question could be readily solved, either by agreement, 
or perhaps by simple natural causes, so soon as it were at- 
tacked logically. This question can obviously only follow 
upon that of the organization of international security, 
which will tend to become identified with economic secur- 
ity, as mankind completes the transition from military civ- 
ilization to true industrial civilization. Disarmament will 
be the logical and natural consequence of the establishment 
of economic security between nations. 

The same will be true of compulsory reconciliation and 
compulsory arbitration between nations, which will then 
become acceptable and will be quite naturally accepted. 



Students, statesmen, and pacifists have far too much 
overlooked the fact that the evolution of human progress 
has constantly and increasingly been influenced by the 

23 



The Economic Solution ojf the European Problem 

economic conditions of each epoch. Henceforth political 
science must draw its inspiration more and more from 
the data of economic science, which deals with human 
relationships in conformity with the nature and necessity 
of things — that is to say, reverencing natural truth and 
justice. For, humanity being part of nature its evolu- 
tion and its history are controlled by natural laws, indis- 
tinguishable from the Will of Providence. Amongst nat- 
ural laws, those of economics, practical and basic rules of 
life for individuals and nations alike, are the most im- 
portant to observe in politics, if it is desired to avoid the 
shocks and disturbances that periodically convulse societies 
and empires. 

Mankind in Europe seems to have reached the decisive 
turning-point of its history. Material progress at an ex- 
cessive and abnormal rate, not balanced by the requisite 
progress in the sphere of morals and philosophy (a de- 
fect, of which the primary cause can be determined), 
had created entirely artificial conditions of social and in- 
ternational life which were weak and unstable in the ex- 
treme. In the sphere of international relations, the wishes 
of a faction, the discontent of a monarch, the rashness of 
a minister, the excesses of a mob, were sufficient to dis- 
turb to an alarming extent the delicate balance .of the tre- 
mendous opposing European forces and to endanger a civ- 
ilization which, though apparently extremely advanced, 
w^as in reality merely fortuitous. The problem is to give 
cohesion, stability, and unity, in foundations and super- 
structure, to a world socially and internationally chaotic. 

We are not here concerned to deal with the social prob- 
lem; it is the international problem that is urgent. Now 
whatever politicians and pacifists may have thought, the 
preservation of economic frontiers (the direct consequence 
of lack of equilibrium between utilitarian and philosophic 
progress), has been the main obstacle to the realization 
of intellectual, moral, and social unity in Western Europe. 
The European Confederation that is the dream of some 
thinkers, would be possible it will be admitted, only if 
tariff frontiers were removed: but if these are removed, 

24 



The Economic Solution of the European Problem 

the political federation of the States of Europe is no 
longer needed. The unique and fleeting opportunity is 
now offered of laying the first free trade foundations of 
co-operative relations between the nations of Europe, which 
would mark the beginning of an era of boundless economic 
and social progress, as well as the advent of universal 
peace. 

The Eomans had conceived the idea and the hope of 
a permanent 'Pax Romana.' The emperors of mediaeval 
and modern Germany have cherished themselves and fos- 
tered amongst their peoples the ambition of a 'Pax Ger- 
manica.' ISTo doubt many friends and admirers of Eng- 
land would ardently desire a Tax Britannica.' But Truth 
and Justice, the eternal twin forces that bear sway over 
mankind, will never rest content till men attain to the 
'Pax Oeconomica.' 



APPENDIX 



TWO LETTERS ON THE EUROPEAN PROBLEMi 

New York, September, 1916. 

I 

Sir: Europe and her statesmen are faced by the following main 
problems : 

Belgium, Poland, the Balkan States, the Bosporus, Asia Minor. 

Alsace-Lorraine; the German colonies. 

"Freedom of the seas," future gradual disarmament, some method 
of international association and arbitration for the preservation of 
peace. 

The future course of European economic relations. 

There cannot be the least doubt that every one of these questions 

1 Appeared in diverse important Belgian, British and American 
papers. 

25 



Appendix 

must be dealt with ; none can be escaped, all must be solved before 
the war can be stayed, before battles can cease. Unless and until 
statesmen discover, for each and all of them, formulas of settle- 
ment acceptable to all powers concerned, the peoples of Europe will 
be condemned to continue inter-ruin and slaughter, even though no 
leader desired to pursue hostilities, aye, even though every individual 
in Europe longed for peace. An armistice for the convocation of a 
conference and discussion of peace terms will not be possible or de- 
sirable, for there are diverse obvious reasons which would prevent 
its lasting on all European, Asiatic, and African fronts, and the 
seas (the insoluble question of blockade and armistice being thus 
raised), a time sufficiently long for permitting adequate discussion 
not only of the whole European problem, but even of any single 
one of the numerous questions affecting it. These, therefore, must 
be discussed, their solutions must be agreed upon in principle, 
before hostilities can temporarily be stopped, before a peace con- 
ference can usefully meet. 

Now, when we consider the extraordinary complexity of all ques- 
tions named (that of Belgium excepted), the apparently irreducible 
contradictions of the interests at stake, the impossibility of definitely 
settling any question separately from all others, we are faced by 
the query: Is there any hope that, between parties still uncom- 
pelled, there can be brought about a general settlement? The an- 
swer is: Certainly not, if the questions are approached in the old, 
narrow, antagonistic spirit and with the disregard of the true and 
common interests which have generally hitherto characterized inter- 
national politics. The creation of a new spirit, as well as of an 
atmosphere of international goodwill and good faith, is indispensable 
if the discussion is to have any prospect of successful result. 

How can the new spirit and such an atmosphere be created? 

To all peoples engaged in this war, the dilemma of victory, or 
defeat appears as meaning nothing less than future liberty and dig- 
nity, which are more precious than life, or future coercion and deg- 
radation, which would prove worse than death. No actual and gen- 
eralized desire for peace, no international goodwill and good faith, 
are conceivable as long as to all belligerents future liberty and 
dignity are not assured. Now, these are no abstract conceptions ; 
from the point of view which for all peace negotiations is the neces- 
sary one, national liberty and dignity can hardly have a meaning 
if deprived of their concrete international form and if not furnished 
with a material international basis — that security of industrial and 
commercial activities, that certainty of general economic oppor- 
tunities, which are necessary for adequate development, prosperity, 
and even for the political welfare of the peoples. No powerful na- 
tion at peace will ever abstain from preparing for war, and no 
nation at war, before being crushed to the point of annihilation, will 
be willing to make peace, much less to acquiesce in means of "en- 

26 



Appendix 

forcing peace" in the future, if not provided with that security. 
And it will be right. 

Four nations, Great Britain, Russia, the United States, and 
France, together rule over nearly the whole of the world's productive 
and promising areas. Is it possible that other nations, highly de- 
veloped economically within and lacking an adequate colonial do- 
main, should be content to see these areas become more and more 
monopolistic, if not practically exclusive? I do not ask this as a 
Belgian, nor as could a German. I ask it as a citizen of the world. 
"Righteousness" demands that problems and situations be considered 
from the standpoint of all parties concerned. 

A settlement leading to a permanent world peace will remain im- 
possible if not based on the principle of economic security and jus- 
tice assured to all nations and most probably no peace of any kind 
ending this war can be concluded (except at the price of very nearly 
the annihilation of both parties of belligerents) unless and until 
the belligerents make mutual offers on this basic principle. 

Being incontestably the indispensable initial conditions of inter- 
national goodwill and good faith, economic security and justice must 
be established at the outset of any peace negotiations. In the order 
of tlie main European questions to be solved, I have indicated "the 
future course of international economic relations" as the fourth and 
last ; in actual practice it must be placed the first, if the negotia- 
tions are to have any prospect of success. 

Tliis "question" then must be dealt with from a new point of 
view — that of the true and common interests of all nations substi- 
tuted for that of national exclusions and egoistic interests; with a 
new conception of international life and relations — that of civiliza- 
tion furthered by association and co-operation of peoples substi- 
tuted for that of civilization hampered by national isolation, trade 
restrictions, privileges, and monopolies; lastly in a new spirit — that 
of equity, peace, and forgiveness, instead of that of jealousy, con- 
flict, and revenge. 

Such a point of view, such a conception and such a spirit find 
their only possible practical expression in international free trade, 
necessarily commencing with "freer trade" relations between all 
the mother countries and with the system of the open door — or 
equality of general economic opportunities offered by and afforded 
to all nations — in all colonies, present and future, of the world. The 
British autonomous colonies should necessarily participate in any 
agreements as independent States. 

Once this great international economic and moral progress is 
agreed upon — but then only — the other European problems can be 
approached and solved. They will be solved with relative and maybe 
with astonishing facility. For, the indispensable atmosphere of 
goodwill and good faith being created, and the new conception en- 

27 



Appendix 

lightening tlie whole European problem, everything becomes possible: 
Belgium can be rehabilitated; tlie way is open to the constitution 
of Prussian, Russian, and Austrian Poland as an independent State; 
national order and international peace can rapidly be re-established 
in the Balkans; the Bosporus can be internationalized; a fruitful 
decision can be arrived at as to the fate of Asia Minor ; Alsace- 
Lorraine can be granted independence with neutrality; German j' can 
renounce certain of her colonies and be permitted the acquisition of 
others; the Germans can be made to understand what is true '"free- 
dom of the seas," and, finally, there can come about a general con- 
sent to future gradual disarmament on land and sea, as the natural 
result of international security, and to some necessarily accompany- 
ing method of international conciliation, arbitration, and police. 

Thus only will the European settlement be complete and definitive. 
Thus only will it be possible to put an end to this terrible war 
before Europe and her civilization have broken down and before 
my country is transformed into an immense cemetery under im- 
mense ruins, this crime being an adequate coronation of the errors 
of European protectionist "statesmanship." 

Never will peace without justice creating goodwill be established 
among nations; never will justice and goodwill among them exist 
without progressive international economic freedom. 

H. I. 



II 

SiB: It is, I think, much to be regretted that Germany, when she 
started this war, has not stated frankly and categorically the real 
reason and object of her enterprise. For, had she done so, it is 
likely that the European conflagration would not have lasted more 
than five or six months, perhaps less. 

There never was, and in any case there does not remain, the least 
doubt that the true main motive was the will of the Germans to 
conquer, at any price and by any means, what they have called 
their "place in the sun." From that will arose (at least, since 
twenty to thirty years) the development of the militarist spirit, of 
the armaments on land and on sea, and of the great conquering am- 
bitions of Germany; from that will is derived the present war. 

Compared with the place occupied "in the sun" by Great Britain, 
by France, by Russia, by the United States, by Holland, by Bel- 
gium — and taking into account growth of population, of industry, of 
commerce, and the comparative value of the colonies — it must be 
recognized that Germany indeed occupies an almost insignificant 
part of the globe. Taking also into account this additional de- 

28 



Appendix 

plorable fact that all nations, especially the great ones, became, 
or threatened to become, increasingly protectionist, the secured mar- 
kets of Germany must be considered as being comparatively even 
more limited than her territories. 

Germany had, consequently, before the war, an extremely serious 
and just case to bring before the other nations for attentive con- 
sideration. She had powerful reasons for demanding either the nec- 
essary facilities for her colonial expansion or guarantees of future 
liberty of commerce or of equal economic opportunities in foreign 
colonial territories. Of course, Germany had no just cause of com- 
plaint against free-trade England, but just cause of fear of a com- 
ing protectionist England, and also, from her point of view, just 
cause of complaint of England's backing of the colonial objectives 
of protectionist France and Russia. 

Why did not Germany make such a declaration of her objectives? 
Why did she not adopt that way of dealing? The reasons are as 
follows: (1) Her statesmen and professors (like those of most 
other countries) were still in that inferior state of mental and 
moral development which leaves men capable of believing in the 
material and even the moral profits of brute-force conquests, and 
incapable of grasping the advantages of civilization based on inter- 
national co-operation and mutual help by free division of labor and 
exchange between nations; (2) there are in Germany, as in other 
countries, but to a greater extent even than in most other coun- 
tries, powerful political parties representing the protectionist and 
privileged interests; (3) the German democratic parties were in 
respect to the international morality of free trade and the inter- 
national immorality of protection not more enlightened than the 
democratic parties of the other nations. So Germany clung to her 
fatal protectionist, and therefore militarist, error. 

Had Germany, declaring war, made known her motives, a for- 
midable discussion on the great question at issue would immediately 
have arisen in all countries, belligerent and neutral, and, as light 
flashes out of discussion, there is no doubt that everywhere in the 
world— Germany included— a strong majority of the more enlight- 
ened, conscientious, and serious people would have backed the Ger- 
man case while condemning the German war, and that an- tinder- 
standing and settlement would have soon become fairly practicable: 
by an agreement for free trade or for a freer trade and equal oppor- 
tunities for .all nations guaranteed (say for one century) in the 
colonial possessions of Great Britain, France, Russia, and, of course, 
of Germany herself. Probably also an agreement would soon have 
followed on German colonial expansion, with the condition of her 
new colonial territories being kept open to the trade of all coun- 
tries. And the opportunity would have presented itself for urging 
Germany to adopt free trade, or at least reciprocity, as between 
mother-countries. 

29 



Appendix 

But Germany, declaring war, had not the foresight, the wis- 
dom, nor even the "goodwill" of stating her motives. 8he started on 
a hopeless undertaking of world-domination. Neither before nor 
since the outbreak of the war has she manifested the intentions 
necessary to useful consideration by the other nations of economic 
peace negotiations. On the contrary, mutual increasing protectionist 
aggressiveness, and consequent growing enmity on the part of all 
nations are to be foreshadowed, Europe being engulfed in a bottom- 
less catastrophic abyss, in which not only the best of her humanity 
may be annihilated and the whole of her wealth absorbed, but in 
which civilization itself may well disappear and for centuries to 
come give place to anarchy and barbarity. 

Is it too late to repair and to save Europe and maybe all other 
nations? All hope would not be abandoned if there existed some- 
where in the world (in neutral or in belligerent countries) men 
wielding the authority of great moral and political achievements 
possessed of the wisdom, eloquence, and will necessary to speak to 
their fellow-men the language adequate to the immensity and fatal- 
ity of the dilemma of Justice or Collapse — men in whom intelligence 
and soul are great enough to make them desirous and capable of 
becoming the redeemers of humanity. 

What unfortunately so few among the statesmen and leaders in 
Germany, in England, France, Russia, Belgium, and elsewhere seem 
to understand, is that human concord can never be possible except 
when based on justice. International economic liberty — that is 
fundamentally international justice — that would be the only secure 
"strategical defence," the only possible international security, be- 
tween the great progressive nations. 

To conclude, is it not obvious that but three ways of ending the 
war remain open : First, territorial acquisitions by the eventually 
victorious nations ; second, financial indemnities by the eventually 
vanquished nations; third, equitable economic arrangements? That 
the two first issues will require a long continuation of the war, 
necessitate incalculable sacrifices and probably mean red ruin and 
the breaking up of laws needs no demonstration. Europe, Civiliza- 
tion, Humanity cannot be saved by Force. They can only be saved 
by Equity, the eternally necessary basis of Harmony. 

Henri Lambert. 



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